Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (47502)	1/30/2001 12:28:45 PM
From: smchan	Read Replies (1) \| Respond to of 77400

you really have to understand the strategic import of the Cisco acquisition of IBM's switching technology. I understand it perfectly. Cisco's method of acquiring the SNA/IP technology was to build a site in RTP and start hiring engineers away from IBM's networking business a couple miles down the road. That was many years ago. The reason behind Cisco's acquisition of IBM's switching technology was to gain access to IBM's service division. Frankly, IBM's network division was languishing probably due to bad decisions during Akers' reign, yet the services division was going full speed building networking solutions for customers; yet they had the albatross of IBM's networking division around their necks since Cisco was the market leader in routers. Bottom line: Cisco buys out IBM's network technology for an undisclosed sum (I reckon Gerstner might've lost it in a golf game to Chambers), Cisco agrees to buy a few billion dollars in OEM parts from IBM, and IBM services starts promoting and selling Cisco equipment in their networking solutions while closing down a money-losing operation. I don't exactly call that brillant on Cisco's part but certainly a win/win situation for both companies. IBM realized it wasn't going to win the router business so might as well get in bed with a company that has it locked up while getting paid to do it. Sam